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Nasdaq would hinder IPOs for Chinese companies, including cryptocurrencies

May 19, 2020

Nasdaq, The second largest stock exchange in the world will introduce new restrictions on IPOs or IPOs, to the prevent smaller Chinese companies from appearing on the list, proposes a recent Reuters report citing anonymous sources.

Chinese IPO applicants generally lack transparency in accounting and have “close relationships with powerful experts”. According to Reuters sources, the new rules are reported to be the first to set a minimum value for the size of IPOs on the Nasdaq.

In particular, the exchange may require companies “in some countries, including China,” to collect at least $ 25 million in their offering, or alternatively, to collect at least a quarter of their post-market capitalization. Chinese companies are not officially named as the reason for the stringent requirements, the sources said.

Nasdaq would hinder IPOs for Chinese companies, including cryptocurrencies
Nasdaq would hinder IPOs for Chinese companies, including cryptocurrencies

While A total of 155 Chinese companies have been listed on Nasdaq since 2000. 40 of these IPOs failed to raise $ 25 million, as can be seen from the data cited by Reutuers.

All companies related to the Chinese cryptocurrency listed on the Nasdaq and other U.S. exchanges. USA (like Canaan Creative and OneConnect) have exceeded this number. While existing rumors and applicants Bitmain and Ebang hope to raise at least $ 100 million, the planned changes are expected to continue to scrutinize all Chinese applicants.

In particular, the accounting firms of Chinese companies that are not yet publicly traded must ensure that their international franchisees meet the “global standards” Nasdaq will also evaluate the audit of small US companies that audit the accounts of emerging Chinese IPOsaccording to sources cited by Reuters.

IPOs in Chinese cryptocurrency

In November 2019, the mining giant Bitcoin (BTC) Canaan Creative was the first Chinese cryptocurrency company to go public in the United States after failing to go public in Hong Kong. After losing his largest bank, Credit Suisse, a few days before listing, Canaan raised $ 90 million, although he originally intended to make $ 400 million.

OneConnect, a Chinese blockchain company supported by Softbank, completed its IPO in December 2019 and raised a $ 347.2 million offer from the New York Stock Exchange.

Almost at the same time Bitmain, the Beijing-based manufacturer of cryptocurrency hardware, tacitly submitted an application for an IPO supported by Deutsche Bank to the US stock exchange regulator.. While it’s unclear how much Bitmain is trying to source, the mining giant hoped to raise up to $ 3 billion in mid-2018.

Finally, major mining chip maker Ebang last month filed for an $ 100 million initial public offering. It was announced that trading on the Nasdaq Global Market or the NYSE was planned under the symbol EBON.

Cointelegraph contacted Canaan, Bitmain, OneConnect and Ebang, but received no response until the editorial deadline.